New U.S. Climate Legislation is Released. Could Climate Legislation in India Be Far Away?

May 12 was a potentially history-making day in the United States, and the events that were set in motion have implications for all nations across the world that are trying to address the problem of climate change. Ending a long wait, Senators John Kerry and Joe Lieberman released the text of their proposed U.S. climate and clean energy legislation – the American Power Act. 

The draft bill is a product of more than eight months of negotiation and drafting, and aims to transform the U.S. economy, set the country on the path of energy independence, and create millions of new jobs. The bill has concrete emission reduction targets: 17 percent reduction in U.S. carbon pollution from 2005 levels by the year 2020; 42 percent by 2030 and 83 percent by 2050. 

Some quick highlights of the American Power Act:

• The draft bill puts a firm limit on U.S. global warming pollution that will result in annually declining global warming pollution and create incentives for clean energy and other low carbon solutions. There is a price collar on carbon under this bill, preventing volatile fluctuations - introductory floor and ceiling prices are set at $12 (increasing at 3 percent over inflation annually) and $25 (increasing at 5 percent over inflation annually), respectively.
• The bill aims to protect consumers from disproportionate energy price rises. With a small portion of the value of emissions allowances put aside for U.S. budget deficit reduction, two-thirds of the remaining allowance value will be devoted to energy efficiency programs and rebates for energy consumers, as well as to research and deployment of clean energy technologies.
• The bill funds critical investments in clean energy research and development, including renewable energy technology, advanced vehicle technologies and carbon capture and sequestration, and also establishes pilot projects to determine the regional feasibility of light- and heavy-duty plug-in electric vehicles.
• The bill provides for border adjustments, to take effect in 2025, requiring importers to buy allowances when they bring in items like steel, aluminum or cement from countries that by then have still failed to adopt their own carbon control programs.
• Unfortunately, the bill also contains provisions that NRDC opposes, including excessive subsidies for building new nuclear power plants and shortcuts in safety and environmental protection safeguards.  The bill also includes Incentives for offshore drilling that NRDC believes have no place in an environmental bill, especially in the wake of the disaster in the Gulf of Mexico. 

It is too soon to state what NRDC’s stand is on every aspect of the bill; our internal experts are studying it carefully to determine which parts hold promise and which parts can be strengthened further. For initial reactions by NRDC’s climate leadership, please read Frances Beinecke’s , David Doniger’s and Jake Schmidt’s blogs on this subject. 

But the bill is a sign that the Senate is moving ahead on the pressing challenge of climate change.  As other nations work to create a strong national and international effort on climate change, they can now hope that the U.S. will pass the domestic legislation needed to get this country moving.   A happy marriage of well-designed domestic laws in all countries and a strong international agreement would truly make for an effective approach to addressing climate change. 

India, the country of my roots and to which I am tied as strongly as to the United States, has indicated on many occasions that it will undertake effective domestic measures to address its greenhouse gas(GHG) emissions, and will enact national legislation to this end. India has also signaled its desire to be a leader in solving the climate change problem, and has joined with the other major emerging nations, in a partnership known as the BASIC countries (Brazil, South Africa, India and China).  India and these other countries have not been waiting for the U.S. to take action, but there is reason to hope that progress in U.S. legislation will add to global momentum . 

As an Indian, I hope that India’s own legal framework will not take as long a time in coming as America’s, but that when it does develop, it too will serve many of the same goals that any good climate and energy bill should be aimed at delivering - strengthening the economic and environmental health of the country, creating green jobs, generating new income from sustainable sectors, and positioning India as a leader in the emerging global clean energy economy. I will be watching India’s reaction with keen interest. 

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